To understand why the Liberals embarked upon an extensive program of social reform in the years 1906-1911, it is essential that we have a firm knowledge and understanding of their social origin. The social and economical status of Britain at that time was not good at all, although some citizens did enjoy the prosperity of Britain, the majority did not.
There are several factors that have helped in the culmination of the social reforms and were influenced mainly by social surveys carried out by social researches like Charles Booth and Seebohm Rowntree. Both revealed the extent to which poverty had infiltrated the country and that some people were too poor to help themselves, let alone struggle throughout the day with the wages they received. Rowntree concluded from his studies a definition of the term "Physical efficiency" meaning to be "functioning physically and effectively" which he later went to declare the lack in physical efficiency in a national scale. National efficiency became a major problem in Britain as recruiting officers in the army later found that one out of three men were not sufficiently fit to join the army and in order to militarize the army, Britain needed a reform. Due to this, the Liberal Party were anxious about this revelation as they came into realization that Britain must be very inefficient and people looked upon the government to act against National Efficiency.
The situation opposed the traditional political strategy of "laissez-faire" whereby the government interfered in local issues as little as possible. National efficiency resulted in the questioning of how effective a laissez-faire government policy really was. New liberalists had also proposed a new modernized view of allowing the government to intervene in people's life in certain circumstances whenever necessary. Experiments in local governments in the late 19th century showed that, if local authorities took over public amenities and facilities, they could be run in a way that benefited the whole community, for example when Joseph Chamberlain was Mayor of Birmingham whereby he reformed Birmingham into a "gas and water socialist" state. The works of Booth and Rowntree had also influenced people such as Lloyd George and Winston Churchill along with other surveys that had been carried out by other social researchers.
They came with an overall result that many recruits for the Boer War were medically unfit or malnourished, the physical state of people in towns were weak which suggested school meals and medical inspections would help, the inadequacies of the workhouse system and the proposal to abolish it as the poor could be better and more economically served if specific types of poverty were tackled (i.e. those born into poverty, and those who did not spend wisely), the suggestion of Labor Exchanges and Unemployment Insurance were needed and the plan of old age pensions would be of great benefit to the British population. Lloyd George and Winston Churchill were also impressed with Germany's success in state intervention under Bismarck's government. Lloyd George visited Germany in 1908 and saw a system of insurance against sickness and accident, as well as a system of old age pensions which had existed since the 1880s.
It was also in the state of mind of British citizens at that time that people were born into poverty and it was their fault that they were poor and suffering. New liberalists were very much against this theory and believed that society should encourage the poor to succeed instead of condemning them into this inherited lifestyle. As a result, new attitudes to the poor and new ideology from New liberalists began to make people realize that it was not the fault of those who were born into poverty. To overcome the poverty rate in Britain, the New Liberal Party argued over taxation and believed taxes should be raised and regurgitated in order to help fund schemes which would help those unable to help themselves. This went against the Old Liberalists who maintained the belief that taxes should be kept low in order for people to remain independent in expenditure and be self-sufficient.
Most importantly, new liberalism ideas did in fact respond to the specific problems in times of political crisis happening in Britain. These reforms are looked upon as revolutionary by many historians as it is the first time ever that the British government interfered in public matters. The reason as to why the interference could be related to four basic categories, compassion, ideology, power and politics.
The compassionate belief is that of those in workhouses were treated maliciously and there appeared to be no morality or sympathy amongst the officers who patrolled them. It stood the basis of the problem, cheating old people out of retirement and killing the future of youngsters who were unfortunate enough to go there. Compassion led to people seeking new ideas to overcome the sufferings faced in these workhouses. New liberalism showed sympathy towards this issue in the shape of old pensions schemes and sickness insurance.
